Bitcoin (BTC)’s attempt to rise above the critical psychological level of $20,000 is faltering as the bears appear to be very strong in the wake of the prevailing macroeconomic factors. Accordingly, technical analysis points to an even bleaker future for the major cryptocurrency.
In particular, the Bitcoin 1-day technical analysis summary on September 4 indicates a strong sell-off at 16 while the neutral levels are at nine. At the same time, none of the analyzes recommends buying the asset at the moment.
The technical analysis breakdown shows that the oscillators are selling at two while nine are neutral. Based on the moving average, the technicians indicate a strong sell-off at 14, while only one shows neutrality. In general, the analysis can be considered that Bitcoin is in an oversold state as the market looks for the possibility of a rally.
This comes as Bitcoin continues to trade below its 200-week moving average, a metric that has historically provided insight into any phase of the best crypto market cycle. The asset has been trading in the area for nearly two months.
Bitcoin extends losses below $20,000
It is worth noting that Bitcoin briefly rose above $20,000 on September 2 after the strong US jobs report. The asset temporarily pushed the public market to regain its $1 trillion in capital. But Bitcoin has since corrected trading to $19,800 at press time, with losses of nearly 2% over the past 24 hours.
Overall, Bitcoin has been trading around the $20,000 level for several weeks after making short-term gains that saw the price climb to $25,000. The price action has inspired some analysts to suggest that Bitcoin may have bottomed.
For example, with Bitcoin’s monthly Relative Strength Index (RSI) at 42.2, crypto analysts plan B Indicates that it may indicate that the asset is preparing for another rally based on historical trading trends.
“Bitcoin RSI 42.2. If history is any guide, it could be RSI 90+ in 1-3 years, if you don’t think history tells nothing about the future and this time is different. Your choice,” he said in one tweet On 2 September.
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Notably, the current Bitcoin price movement is in line with analyst expectations that the strong August jobs report will lead to a further correction in the crypto market.
This comes after the large Bitcoin correlation to the stock market amid the prevailing high inflation environment. Therefore, a stronger-than-expected jobs report is likely to prompt the Federal Reserve to implement tougher tightening measures such as raising interest rates to tackle high inflation.
As reported by Coinphony on September 3, Kitco News analyst Rajan Dhall indicated that Bitcoin’s chances of exiting an extended bear market will reach over $25,066 by first targeting $21,760. While many analysts expected it to likely correct to $15,000, Dhall believes that if Bitcoin fails to hold around $20,000, the crypto could consolidate to $17,567.
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Bitcoin technical analysis then shows more pain ahead as analysts show BTC bottoming first on Coinphony.